Value Relevance and Firm Performance in Nigerian Banking Sector

ABSTRACT

           The broad objective of the study was to examine the influence of value relevance of accounting information on firm performance of deposit money banks in Nigeria with emphasis on Pre and Post International Financial Reporting Standard (IFRS). The specific objectives were to examine effect of leverage, liquidity and firm size on bank performance. The study is an ex-post facto and covers time periods of eleven years broken down into five years (2007-2011) as Pre-IFRS adoption, and six years (2012-2017) as Post-IFRS. A total of sixteen quoted banks on the Nigerian Stock Exchange constituted the population while a sample of twelve (12) banks was purposively selected due to available data. Historical data were obtained from the financial statements and accounts of the sampled banks. Data estimation was done with computer software (E-views 8.0). Data analysis was done using descriptive statistics, and fixed effect panel least square regression. Findings from this study revealed that leverage has no significant effect, while liquidity and bank size have significant effect on bank performance in Pre-IFRS adoption. Similarly, leverage has significant effect but negatively related in Post-IFRS period while liquidity and bank size were positively related to bank performance in Post-IFRS adoption.